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The Legislative Report blog provides timely information on federal and state legislation and regulations and state trends as well as the myriad issues affecting the private club industry. A companion to CMAA's Legislative website, this resource should be your first stop for any information regarding legal, tax or legislative club-specific issues.

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IRS Proposes New Regulations on Separate Trades or Business and Other Changes

(IRS) Permanent link

In late April, the Treasury and Internal Revenue Service (IRS) released proposed regulations (REG-106864-18) under section 512(a)(6), which provide long-awaited guidance on computing unrelated business taxable income (UBTI) that likely will affect most tax-exempt private clubs.


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Updated Considerations for Clubs Receiving Funds from the Payroll Protection Program

(Congress, IRS, SBA) Permanent link

There are multiple considerations for businesses involved with the Payroll Protection Program, administered by the Small Business Administration (SBA).

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Further SBA Guidance Deems Private Clubs Ineligible

(Congress, Dept of Labor, IRS) Permanent link

Last week, CMAA shared that within HR 748, the Coronavirus Aid, Relief, and Economic Security Act (CARES Act), 501(c)(7) clubs were excluded from eligibility for Payroll Protection Loans from the Small Business Administration (SBA). These loans of up to $10 million would enable clubs to help maintain operations (payroll, mortgage, rent, utilities, and certain debt payments).

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What Can Clubs Take Advantage of in COVID Federal Stimulus

(Congress, Dept of Labor, IRS) Permanent link

HR 748, the Coronavirus Aid, Relief, and Economic Security Act (CARES Act), was signed into law on Friday, March 27. This is the third measure to address the impact of COVID-19. Within the bill, 501(c)(7) clubs were excluded from eligibility for Payroll Protection Loans from the Small Business Administration (SBA). These loans of up to $10 million would enable clubs to help maintain operations (payroll, mortgage, rent, utilities, and certain debt payments).

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IRS Issues Guidance on Employee Retention Credit under the CARES Act

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On March 31, the Internal Revenue Service issued guidance regarding the Employee Retention Credit passed in HR748, the Coronavirus Aid, Relief, and Economic Security Act (CARES Act), enacted on March 27, 2020. Clubs are eligible to use this credit, designed to encourage employers to keep employees on their payroll, despite experiencing economic hardship related to COVID-19.

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Too Much Non-Member Income Jeopardizes Exempt Status

(IRS, Regulation) Permanent link

Among the Internal Revenue Services’ compliance strategies for FY2019 is a focus on tax-exempt clubs and their investment income, non-member income and non-filing of Form 990-T, Exempt Organizations Business Tax Return. To this end, and in furtherance of the IRS's educational initiatives, some clubs have received letters from the IRS encouraging them to monitor their gross receipts from non-member sources and to maintain books and records demonstrating continued qualifications for exemption.

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What You Need to Know About the Shutdown(1)

(Congress, Dept of Labor, OSHA, IRS, Regulation) Permanent link

The partial federal government shut down officially began on at 12:00 p.m. midnight on December 22. More than 800,000 workers have been furloughed nationwide. While some operations like national security are deemed necessities, nine of fifteen regulatory agencies are closed until further notice.

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